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17:19 ET UK STOCKS REVIEW: UP AS TECH, TELECOMS, INSURANCE ISSUES FIRM


By Steve Slater, BridgeNews London--Aug. 14--U.K. blue chip equities had a steady but unspectacular start to the week, as a strong performance by insurance, retail and most telecoms stocks left the benchmark index with modest gains at the end of the day. The FTSE-100 index closed up 35.4 points, or 0.5%, at 6419.9.

* * * The benchmark recovered from a soft opening to touch an intraday high of 6451 points just before midday, up 66 points on the day. The index held within a narrow range throughout the afternoon after a mixed opening on Wall Street; at the time of the London market's close, the Dow Jones Industrial Average was down 0.1%, while he volatile Nasdaq U.S. technology index was 0.6% higher. Volume on all FTSE-100 stocks was 604 million shares, well down from its 10-day average of 796 million. Andrew Withey, head of strategy at HSBC Investment Management in London, said the listless trading is a continuation of the range-bound activity seen in the U.K. equity market for the past year. Withey said this is due to "an equal balance of forces" evident in a trio of key areas for equities: U.K. interest rates continue to move higher, although the rate cycle does not appear to have peaked yet; company profits continue to rise, but earnings growth has edged back to about 9% from levels of 12-13% six months ago; and valuations of many of the 'new economy' stocks have been trimmed, in contrast to a modest recovery in valuations for many 'old economy' sectors. "Hence on valuations, interest rates and profits, there's no reason for the market to move in either direction. There's nothing to kick the market one way or the other," Withey said, adding there were few signs of this changing in the near future. A strong start to the week by insurance, food retail, pharmaceuticals and telecoms sectors outweighed weakness in the oil sector. Telecoms were lifted by the possibility of another major European deal, as gossip swirled that Finland's Sonera could be the subject of a U.S. $30 billion bid from several European companies. France Telecom's Orange is seen at the front of the queue. Also supporting the international telecoms operators was the first withdrawal from Germany's UMTS mobile phone auction late Friday, a first sign that the auction could be nearing its end. There are still six companies involved in the bidding, including Vodafone Group (closed up 2.4%) and British Telecommunications (down 0.4%). Business telecoms company Energis rallied 6.1%, as dealers said it was lifted by positive broker comments about its Internet plans. Colt Telecom shares were also higher, ending up 2.8%. The media sector was initially lifted by the release of strong interim results and bullish forecasts from WPP Group, the world's largest advertising company. WPP said its pretax profit in the six months to June 30 totaled 137.7 million sterling, up 22% on a year earlier and at the upper end of the range of analyst expectations. WPP said it is confident the strong first half will be repeated in the second half of 2000. But WPP gave up early gains, and closed 0.1% lower. In the banking sector, Abbey National and Alliance & Leicester continue to be eyed as possible takeover targets in the wake of last week's 5.4-billion-sterling takeover of Woolwich by Barclays. Abbey shares closed 3.3% higher, while Alliance firmed 1.8%. Technology stocks were generally firmer, with the techMARK-100 index of leading U.K. technology shares advancing 0.7%. Shares in Dixons dipped 1.8% and Freeserve, the Internet service provider that Dixons holds an 80% stake in, fell 2.7% after the companies said they signed a strategic partnership with Gameplay.com. Freeserve also faces the prospect of being relegated from the FTSE-100 at the next index review, due on Sept. 5. Meanwhile, lastminute.com, the high-profile web-based retailer, said it is to buy France's Degriftour for 59 million sterling. And online auction site QXL.com said it has agreed a deal with cable company NTL to expand delivery of its online auctions. Lastminute.com shares closed unchanged, while QXL.com fell 3.4%.

OTHER STOCKS IN THE NEWS: --U.K airports operator BAA released strong traffic figures showing it carried 12.7 million passengers in July, up 6.8% on a year ago. BAA shares closed down 0.1%. --The U.K.'s Takeover Panel is to meet Tuesday to discuss the ongoing takeover battle for Hyder PLC, the Welsh utility company. A spokesman for the Takeover Panel confirmed the meeting will include the two companies bidding for Hyder--U.S. company Western Power Distribution (WPD) and Japanese bank Nomura--but he declined to say when a decision is likely to be released. End

Copyright 2000 Bridge Information Systems Inc. All rights reserved. [symbols:GB;FTSE]

The Bridge ID for this story is 01200





(c) Copyright 2000 FWN


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17:19 ET ADD1: US EQUITIES REVIEW: BROADLY HIGHER; FINCLS, TECHS LEAD RALLY
--DJIA up 148; Nasdaq 60; S&P; 500 up 19 --Chip stocks higher; airlines fall By Rebecca Byrne, BridgeNews New York--Aug. 14--After an indecisive start, U.S. stocks ended higher Monday as optimism over the interest rate outlook fueled Full Story

17:19 ET US CREDIT REVIEW: BONDS UP 5/32 AFTER RETRACING EARLY LOSSES
By Rebecca Smith and Susan Kelly, BridgeNews New York--Aug. 14--Long-term Treasury prices managed to close slightly higher Monday after the bond market spent most of the session erasing the losses posted overseas and in early U.S. trading. In spite of the comeback, traders were generally somewhat bearish. Full Story

17:19 ET GERMAN STOCKS PM: DAX AT INTRADAY LOWS, FOLLOWING NASDAQ DOWN
By BridgeNews Frankfurt--Aug. 14--German's DAX moved sideways near intraday lows toward the end of trade on bearish impetus from U.S. stock markets, which saw the Nasdaq Composite and the Dow showing signs of weakness. In overall thin turnover, Deutsche Telekom AG was near the top of daily percentage gainers as Full Story

17:19 ET WHOLESALE INVENTORIES ROSE 0.9 PERCENT IN JUNE
WASHINGTON, Aug. 14 (UPI) -- The Commerce Department said Monday that wholesale inventories rose 0.9 percent in June after rising a revised 0.9 percent in May, which was originally reported as rising 0.8 percent. Most economists on Wall Street were expecting inventories to rise 0.5 percent during the month. Full Story

14:49 ET US EQUITIES MIDDAY: WAVERING, SEEKING DIRECTION IN NEWS VACUUM
--DJIA up 16; Nasdaq 6; S&P; 500 up 3 --Chip stocks higher; financial shrs slip By Rebecca Byrne, BridgeNews New York--Aug. 14--U.S. stocks hovered around unchanged levels in midday trade, with little economic or earnings news to Full Story

14:49 ET US DEBT FUTURES ALERT: SEP BONDS STEADY BUT RANGE-BOUND
BridgeNews--Chicago, Monday, Aug. 14 Central Time Full Story





 
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